Bill > HB424

This bill revises the tax classification and treatment of data center property in Montana, extending several key provisions and clarifying ownership and operational requirements. Specifically, the bill extends the timeframe for data center property construction from 2027 to 2037, modifies ownership requirements to include wholly owned subsidiaries or parent companies with 100% ownership interest, and introduces new provisions for electrical generation systems associated with data centers. The bill allows data centers to own and operate electrical generation systems that can be used primarily for onsite power, with these systems being taxed at a reduced rate of 0.9% for 10 years. It also mandates that if electrical power produced by a data center generator is sold to a public utility or electric cooperative, the price cannot exceed the cost of production, which is carefully defined to include capital costs, depreciation, wages, fuel, and operating expenses, but exclude administrative and legal costs. Additionally, the bill ensures that data center property in tax increment financing districts will be subject to school equalization mill levies, and provides utilities the right to audit the operating costs of data center generators. The legislation applies retroactively to property tax years beginning after December 31, 2024, and takes effect immediately upon passage.